Showing papers on "Strategic planning published in 1988"

Exploring Corporate Strategy

Abstract: This book brings together the underlying concepts, analytical methods, processes of development and problems of corporate strategy, enabling readers to understand the role of corporate strategy within a variety of organizations and providing guidance in the formulation and implementation of strategy. Features include: an approach based on economic analysis and planning, and organizational decision-making within a social, political and cultural process; a strongly European/international perspective, with more than 60 company illustrations; an integrated treatment of the cultural context of strategy; coverage of the increasingly important issues of power and process of strategy, formulation and change; a case section comprising 17 studies. The text includes diagrams of key frameworks, chapter introductions, end-of-section work assignments, references and key readings. Features new to the fourth edition include: competences, core competences and links to the value chain; bases of stategy at corporate and business level; global aspects of strategic management; corporate parenting and control; strategic architecture; networks, allians and virtual organizations; the strategic importance of information; and mechanisms of strategic change.

Implementing Entrepreneurial Ideas: The Case for Intention

Abstract: Entrepreneurial intentions, entrepreneurs' states of mind that direct attention, experience, and action toward a business concept, set the form and direction of organizations at their inception. Subsequent organizational outcomes such as survival, development (including written plans), growth, and change are based on these intentions. The study of entrepreneurial intentions provides a way of advancing entrepreneurship research beyond descriptive studies and helps to distinguish entrepreneurial activity from strategic management.

On strategic networks

Abstract: In parallel with a theoretical acceptance of the importance of the laws of competition to formulate strategy, the realization is growing that cooperative behavior among firms is at the root of many success stories in today's management. This situation calls for an effort to develop a theoretical framework to study both aspects of firm behavior (cooperative and competitive) as compatible, complementary aspects of a unique reality. Indeed, the cooperative relationships of a firm can be the source of its competitive strength. This paper develops the concept of strategic network, as a tool to understand those cooperative relationships and their role in the strategy of the firm. There are three main tasks of the paper: first, to show that strategic networks are but a ‘mode of organization’; second, to study the economic conditions of existence of a network; finally, to analyze the conditions of existence of a network from the point of view of its internal consistency. In a final section some of the most obvious strategic implications of the framework are outlined.

Strategic decision processes in high velocity environments: four cases in the microcomputer industry

Abstract: How do executives make strategic decisions in industries where the rate of technological and competitive change is so extreme that market information is often unavailable or obsolete, where strategic windows are opening and shutting quickly, and where the cost of error is involuntary exit? How do top management teams divide the decision making responsibility? And how is risk of strategic error mitigated? What we report here is a set of hypotheses induced from a field investigation of four microcomputer firms, where we studied how each of the top management teams went about making major decisions. Our goal was to extend prior work on strategic decision making to what we term high velocity environments. Our results consist of a set of paradoxes which the successful firms resolve and the unsuccessful firms do not. We found an imperative to make major decisions carefully, but to decide quickly; to have a powerful, decisive CEO and a simultaneously powerful top management team; to seek risk and innovation, but...

Managing Quality: The Strategic and Competitive Edge

Abstract: The article presents a review of the book “Managing Quality: The Strategic and Competitive Edge,” by David A. Garvin.

Relating Porter's Business Strategies to Environment and Structure: Analysis and Performance Implications

Abstract: This study investigated the relationships of Porter's business strategies to the structures and environments of undiversified firms. It was shown that strategies must be matched with complementary ...

A Contingency Approach to Strategy Implementation at the Business-Unit Level: Integrating Administrative Mechanisms with Strategy

Abstract: This study focused on what is perhaps the most critical aspect of strategy implementation in large, multibusiness organizations: recognizing that different business units within the same corporation often pursue different strategies and that the administrative mechanisms that corporate headquarters use to manage those businesses should differ. This study compared the results of bivariate and systems approaches to fit. Implications of the results for theory development and managerial practice are discussed.

Managing Two Fits of Strategic Human Resource Management

Abstract: A model for developing and implementing human resource management strategies incorporating both an external fit (human resource management fits the developmental stage of the organization) and an internal fit (the components of human resource management complement and support each other) is proposed. Human resource management is seen as having five developmental stages and six strategic components. These are combined to form the Human Resource Strategic Matrix. The implications of these ideas for research and practice are discussed.

Diversity, diversification, and profitability among british manufacturing companies, 1972-84

Abstract: This study investigated the causal relationships between diversity, diversification, and profitability among 304 large British manufacturing companies that differed in both product and multinationa...

Strategic Human Resources Management: A Review of the Literature and a Proposed Typology

Abstract: Past efforts to relate the management of human resources to a firm's business strategy have taken three approaches: matching managerial style or personnel activities with strategies, forecasting manpower requirements given certain strategic objectives or environmental conditions, and presenting means for integrating human resource management into the overall effort to match strategy and structure. In this article, the literature on each of these approaches is reviewed, and a typology is presented that posits a reciprocal interdependence between a firm's business strategy and its human resources strategy Implications for research and practice are discussed.

Planning under pressure : the strategic choice approach

Abstract: This decision-centred approach has been widely hailed as a breakthrough in planning thought. It bridges the difficult gap between the aspirations of strategic planning and the realities of day-to-day management. The approach is specifically designed to help people plan under the familiar pressures of uncertainty, shortage of time, limited resources and conflicting interests. Since it first emerged from a pioneering study of British city government at work by operational researchers and social scientists, the approach has been applied to a wide range of organizational and interorganizational planning problems and has proved especially effective as an aid to interactive working in interdisciplinary groups throughout the world. This extensively illustrated book offers an authoritative, up-to-date guide to the subject. It is written not just as an introduction to the philosophy and techniques of strategic choice, but also as a handbook for quick reference by users. It includes illustrations from practical applications in several countries and will be invaluable not only to students of planning and academics, but also to practitioners working in any field of business management or public policy.

The new corporate strategy

Abstract: STRATEGY FORMULATION: Structure of Business Decision A Model for Strategic Decision Objectives A Practical System of Objectives Synergy and Capability Profiles Concept of Strategy Diversification and Internationalization Competitive Analysis Choice of Portfolio Uses of Strategy GENERAL MANAGEMENT CAPABILITY: The Need for Entrepreneurial Capability Diagnosing General Management Capability Planning Strategic Positive Transformation Assuring Coexistence of Competitive and Entrepreneurial Activities Resistance to Change Four Approaches to Managing Discontinuous Change The Accordian Method of Managing Change Overview of Strategic Behavior.

The cognitive perspective on strategic decision making

Abstract: Strategic management researchers are showing increased interest in the cognitions of strategic decision-makers. In this article, the importance of strategic cognitions is discussed and research on a number of major topics within the cognitive perspective is summarized. the paper concludes with an integrative model of cognitions in strategic decision making. This model provides the basis for questions for future research.

A Contingency View of Porter's “Generic Strategies”

Abstract: According to Porter, cost leadership and product differentiation can be pursued simultaneously only under rare conditions: It is also unclear how these strategies can be implemented. In this article Porter's generic strategies are linked to external preconditions. This approach shows that the generic strategies are not mutually exclusive and that each strategy may be linked to a variety of strategic means. The implications that these results have for structuring organizations are discussed.

Planning and financial performance among small firms in a growth industry

Abstract: This paper examines the relationship between planning process sophistication and the financial performance of a select group of small firms in a growth industry. Multivariate analysis of variance is used to identify statistically significant differences between firms that employ sophisticated plans and those that do not. The results support previous research on strategic planning and financial performance.

The Special Role of Strategic Planning for Family Businesses

Abstract: Most family-owned businesses struggle to survive beyond a single generation. Strategic planning—for both business and family—can help to strengthen the family enterprise and extend its lifespan.

Toward a System for Classifying Business Strategies

Abstract: Porter's (1980) and Abell's (1980) attempts to classify business strategies have several fundamental limitations After discussing the objectives and attributes of “scientific” classification systems, this article presents a new classification scheme, built on the work of Porter and Abell, as a first step toward developing an “optimal” business strategy classification system.

Environmental Scanning Practices in Small Business

Abstract: PRATIQUES D'ETUDE DE L'ENVIRONNEMENT DANS LA PETITE ENTREPRISE Cet article analyse les pratiques d'Atude de l'environnement des proprietaires/managers qui dirigent a la fois sur le plan operationnel et strategique la planification de firmes de moins de 30 employes. 88 sujets representatifs de ce groupe ont ete soumis a une interview semi-structuriee. Les resultats revelent que ces managers conduisent des enquetes de facon periodique ou continue. Ils accordent plus d'interdt aux sources d'information personnelles (famine, amis, clients), qu'aux sources impersonnelles (revues et journaux). Les variables etudities sont par ordre d'importance, le march@ et les conditions deonomiques. During the last several years extensive attention has been given to strategic planning. Until the early 1980s, most of this attention focused on planning in larger firms. Several recent studies have contributed to the knowledge of strategic planning in small firms.' Practitioners and academicians continue to debate the merits of strategic planning, but some research suggests a clear link between strategic planning and the success of small businesses. These recent studies have shed some light on environmental scanning as a part of the planning process in small firms. Dollinger found that scanning is positively correlated with the firm's financial performance, and Specht found that personal sources were used more than impersonal ones by the management at small banks.' Johnson and Kuehn report that owner/managers of small businesses focus largely on their marketing channels to acquire external information. Note, however, that some of the organizations investigated in these three studies had specialized planning departmentsunusual among small firms. The purpose of the present study was to investigate the environmental scanning practices and information sources of owner/managers of small firms which do not have planning departments. Five questions were addressed: 1. What is the most prevalent small firm scanning pattern- irregular, periodic, or continuous? 2. Do owner/managers of small firms believe personal or impersonal sources of information to be more important? 3. What are the most prevalent personal sources of information, and are formal or informal personal sources used more frequently? 4. What are the most prevalent impersonal sources of information, and are written or oral impersonal sources used more frequently? 5. Do the answers to question I through 4 vary as a function of the perceived stability of the environment or the environmental unit under analysis? BACKGROUND Environmental Scanning As an integral component of planning, environmental scanning is defined as gathering and interpreting pertinent information and introducing the results into the organizational decision process. An owner/manager scans the environment to detect external changes or events which may affect the firm. The notion of environmental scanning developed as a part of the open systems concept. According to open systems theory, organizational survival and growth depend on an organization's ability to adapt to its environment. Thus, it is critical that an organization be aware of the nature of the environment that it currently faces or anticipates facing . To achieve environmental awareness, many large firms employ specialized environmental scanners. A key function of these scanners is to analyze the environment and provide a data base for planning. It has been suggested that executives should create a specialized administrative component for systematic environmental scanning. Most researchers agree that environmental analysis should be an independent staff function in the top levels of an organization's hierarchy. Much of the research on environmental scanning in large firms has attempted to classify environmental scanning practices. …

Strategy Making as a Social Learning Process: The Case of Internal Corporate Venturing

Abstract: Juxtaposing interview and observational data with written documents concerning three internal corporate ventures suggests that strategy making in the emergent stage can be viewed as a social learning process in which managerial action and cognition are intrinsically intertwined. Strategic action at higher levels in the managerial hierarchy benefits from interpretative efforts of strategic action at lower levels. A social learning model of strategy making helps to elucidate the uses of strategic planning in organizations and provides an extended theoretical context for several major findings in organizational decision making and strategic management theory.

Interlocking Directorates as An Interorganizational Strategy: A Test of Critical Assumptions

Abstract: The article presents a study which identified some critical assumptions underlying the view that interlocking directorates are vehicles for interorganizational coordination or control. A discussion...

Initiation of Strategic Planning by Governments

Abstract: Government leaders have become increasingly interested in strategic planning since the early 1970s as a result of the wrenching changes that have beset the public sector (Eadie, 1983). The changes have stemmed from oil crises, demographic shifts, changing values, tax levy limits, tax indexing, tax cuts, reductions in federal grants and mandates, the devolution of responsibilities, and a volatile economy. The changes have brought into sharp relief the need for important policy choices and thus have highlighted the potential usefulness of strategic planning. Indeed, strategic planning may be defined as a disciplined effort to produce fundamental decisions and actions that define what an organization (or other entity) is, what it does, and why it does it (Bryson, 1988; cf. Olsen and Eadie, 1982, p. 4). The deliberate attempt to produce change is probably the greatest strength and weakness of strategic planning as a process. Changes in organizations normally occur through disjointed incrementalism or "muddling through" (Lindblom, 1959; Quinn, 1980). Any process designed to force important changes, therefore, can be seen either as a highly desirable improvement on ordinary decision making or as action doomed to failure. Indeed, whatever the merits of strategic planning in the abstract, normal expectations have to be that most efforts to produce fundamental decisions and actions in government through strategic planning will not succeed. At the very least, strategic decision making in public organizations should be prone to involvements by numerous actors (especially through boards, committees, task forces, and teams), variability in information, extensive negotiations, and frequent delays. Further, because of pressures for public accountability, decisions ultimately are likely to be made at the highest levels (Hickson et al,. 1986, pp.1 17, 203), while political rationality dictates that top decision makers not make important decisions until forced to do so (Benveniste, 1972, 1977; Quinn, 1980). The study reported here tracked the initiation of strategic planning by eight governmental units. All are located in the Twin Cities metropolitan area of Minnesota. Each used the same basic strategic planning process (see Figure 1) (Bryson, Freeman, and Roering, 1986; Bryson and Roering, 1987; Bryson, Van de Ven, and Roering, 1987; Bryson, 1988). The process consists of eight steps: an initial agreement or "plan for planning"; identification and clarification of mandates; mission formulation; external environmental assessment; internal environmental assessment; strategic issue identification; strategy development; and development of a description of the organization in the future -its "vision of success."

Hindsight Bias and Strategic Choice: Some Problems in Learning From Experience

Abstract: Knowing eventual outcomes often distorts later reevaluations of initial decisions. Does training in strategic decision making overcome such bias? In two experiments, advanced strategy students anal...

Corporate Strategic Planning

Abstract: Corporate Strategic Planning (CSP) reports on an important study of planning practices and the value of those practices. Though it is a long book, nearly 500 pages, one can get almost the full benefit by reading about 200 pages. In fact, CSP contains an excellent summary (Chapter 11) that is only 33 pages; this chapter should be sufficient for most readers. My review assesses what the book has to offer and provides a guide to the potential reader. Comments Postprint version. Published in Journal of Marketing, Volume 54, Issue 2, April 1990, pages 114-119. Publisher URL: http://www.ama.org/pubs/jm/index.asp This review is available at ScholarlyCommons: http://repository.upenn.edu/marketing_papers/122 Book Review of Corporate Strategic Planning, By Noel Capon, John U. Farley, and James M. Hulbert, New York: Columbia University Press, 1988 By J. Scott Armstrong Reprinted with permission from Journal of Marketing, Vol. 54, April 1990, 114-119 Corporate Strategic Planning (CSP) reports on an important study of planning practices and the value of those practices. Though it is a long book, nearly 500 pages, one can get almost the full benefit by reading about 200 pages. In fact, CSP contains an excellent summary (Chapter 11) that is only 33 pages; this chapter should be sufficient for most readers. My review assesses what the book has to offer and provides a guide to the potential reader. The book provides an extensive and up-to-date review of the literature, but its primary contribution comes from the authors' 1980 survey of corporate planning practices. The firms surveyed were selected from the 258 firms in the Fortune 500 located in the eastern half of the United States. A random sample of 155 firms was selected from this frame. One hundred thirteen interviews were obtained. There were only nine refusals; most nonresponse was due to scheduling problems during the interview period. Extensive structured interviews were held with the chief planner and one assistant in each of the firms. The researchers also examined planning documents; they obtained 501 measurements on aspects of planning. In addition, information was gathered on another 400 environmental factors for each firm. This is the most comprehensive survey of planning practices published to date. Despite the wide range of measures, I would have preferred some others. In particular, if one views planning as a way to improve the performance of a system, it would be interesting to examine measures of performance for the total system. Seeing how the various stakeholders (e.g., customers, creditors, employees, community) are affected would be useful. Unfortunately, as with most research, this study focuses only on measures of profit. The authors of CSP recommend that Chapter 2 be read because it provides their definitions and assumptions about formal planning. I concur with this recommendation. Though the work in this chapter is innovative and shows excellent attention to assessing construct validity, it often departs from my own opinions. For example, I disagree that the purpose of strategic planning is to secure a competitive advantage for the firm. One might argue that strategic planning should improve the returns on investment to each of the stakeholders. I also disagree with the assumption that planning is more appropriate for large, multiproduct firms because it is too difficult to gain commitment in such firms. Instead, planning should be done by small units. Finally, the authors' description draws heavily on what they call "received wisdom." I would have preferred more reliance on prior research, especially research from organizational behavior, which is almost totally ignored in CSP. The research literature provides a simple definition of formal planning as an explicit attempt to gain commitment to a four-step procedure: first, to set objectives; next, to generate alternative strategies; then, to evaluate strategies; and finally to monitor performance. This definition often clashes with CSP's definition. However, the CSP definition is more closely aligned with current planning practices. CSP provides useful information in Chapter 3. This well-written chapter provides a more up-to-date and detailed description of planning practices than is given by Hopkins (1981), whose work, surprisingly, is not cited in CSP. The companies with the best planning practices are compared with the rest of the sample. Though these best planners had consistently better practices by their definitions, the differences are minor. One of the more interesting findings reported in Chapter 3 is that only 40% of the firms prepare contingency plans. Though not high, this figure is substantially more than the 24% obtained in Hopkins' (1981) examination of plans from 267 firms and the 0% estimated in the survey of 50 corporate planners by Armstrong and Reibstein (1985). This failure to develop contingency plans is a serious omission. Military leaders in Argentina were prosecuted in 1988 for mismanagement in the Malvinas (Falkland Islands) invasion; a major charge was that they failed to provide a contingency plan on what to do if the British attacked the islands. Another interesting finding in Chapter 3 is that planners claim to devote much more attention to analyzing competitors than they do to analyzing their customers. In my opinion, this practice is detrimental. It may reduce the overall returns to the stakeholders. The various procedures associated with marketing planning also are examined. For example, the authors found that portfolio methods are widely used and that the BCG approach is the most popular of those methods. Interestingly, they also found the firms using BCG to be less profitable than the nonuser firms. Chapter 10, an important section of the book, relates planning to performance. The primary criterion for the firm's performance is return on capital. A most unfortunate typographical error appears where the authors define this criterion (see the last paragraph on page 292). The formula is meaningless; it adds dollars and percentages. The formula should read: (net profit + interest on long-term debt)/(long-term debt + net worth). Recognizing the wide variation in year-to-year earnings, the authors average over a five-year period from 1977 through 1981. The procedure is excellent, though it would be useful to look at the period after planning rather than the periods before and during. (The authors do address this point, as noted subsequently). The authors of CSP conclude that their survey furnishes only moderate support for the value of planning. The primary problem is the finding that though the good planners performed better than firms that planned less well, the nonplanners did best of all. However, there were only seven nonplanners and their good performance was due primarily to one firm. In a point that warrants more emphasis, the authors report a follow-up analysis examining the return on capital for these firms up to 1984; it shows that the nonplanners did not do as well as the good planners. In view of the long-term focus of planning, the period after the survey is more relevant than the period before the survey. CSP found other results supporting the value of formal planning: 1. The planners themselves believe that formal planning leads to better performance (p. 72). 2. The planners report that line managers favor formal planning (p. 100). 3. Formal planning reduced risk (as measured by variability about the trend line for earnings). The nonplanners performed least well of all groups on this criterion (table 10.4; p. 300). 4. The 70 firms whose planning managers responded "yes" when asked, "Does your company develop a formal corporate plan (or plans) on a regular basis?", had higher earnings in 1977-1981 than did those whose planning managers answered "no" (see p. 297). This difference is not significant and is negligible in magnitude. However, the formal planners had less risk by the definition in result 3. The pattern of results in CSP, then, provides support for the value of formal planning that can be added to my box score on the value of planning (Armstrong 1986). Studies by Gershefski (1970) and Welch (1984) should be included; these two studies, which favor formal planning, are included in CSP but were omitted by Armstrong. Other recent studies that should be included are those of Robinson et al. (1984), Ackelsberg and Arlow (1985), Bracker and Pearson (1986), Ramanujam and Venkatraman (1987), Rhyne (1987), and Verhage and Waarts (1988), where the direction of the results favored formal planning; Van der Walt et al. (1989) that showed no effects; and Whitehead and Gup (1985) with negative results. The updated evidence on the value of formal planning versus informal is as follows: C 20 studies found higher performance with formal planning, C five studies found no difference, and C three studies found formal planning to be detrimental. Thus, formal planning, as practiced, does seem useful and the results are statistically significant (p < .01 by the sign test). Unfortunately, with the exception of Van de yen's (1980), the prior field research is based on nonexperimental evidence. 1 The box score on page 184 of that paper contains an error; it should be four ties rather than eight ties. Also, the reference to Terpstra is incorrect; the article was in the Journal of Applied Psychology. Despite these positive results on the value of planning, I suspect that many of the procedures labeled as formal planning are misused (Lyres and Lenz 1982). For example, formal planning is sometimes used in an authoritarian way that can produce resentment in an organization. To find evidence on the planning practices that are most likely to help, one must draw upon the laboratory experiments in organizational behavior. CSP examines how "good performers" differed from "poor performers" with respect to planning. The conclusions (p. 360-361) seem sensible and in line with prior re